Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow and margin weakened compared to both the prior quarter and the same quarter a year earlier, despite higher revenue. The decline was driven by a material drop in operating cash flow, while capital expenditure increased modestly.
- Revenue increased from the prior quarter and the same quarter a year ago, yet operating cash flow decreased significantly, resulting in lower free cash flow and a reduced free cash flow margin. Capital expenditure rose slightly, contributing to the weaker conversion.
- Compared to the prior quarter, operating cash flow, free cash flow, and margin all declined, despite a modest revenue increase. Versus the same quarter a year ago, revenue was higher but operating cash flow, free cash flow, and margin were lower, with a larger relative drop in cash generation.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$188.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$244.0M
Cash generated by operations before capital spending.
CapEx
$56.0M
Capital spending and related asset purchases.
FCF margin
9.9%
The share of revenue converted into free cash flow.
Cash flow trend
A short quarterly history shows whether FCF is scaling with revenue or only spiking for one period.
| Period | Revenue | Operating CF | CapEx | FCF | FCF margin |
|---|---|---|---|---|---|
| 2023-12-31 | $1.6B | $417.0M | $42.0M | $375.0M | 22.8% |
| 2024-03-31 | $1.7B | $530.0M | $39.0M | $491.0M | 29.3% |
| 2024-06-30 | $1.8B | $460.0M | $52.0M | $408.0M | 22.8% |
| 2024-09-30 | $1.9B | $244.0M | $56.0M | $188.0M | 9.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 61.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$9.1B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating cash flow decline
Operating cash flow decreased compared to both the prior quarter and the same quarter a year ago, while revenue increased. This divergence drove the lower free cash flow and margin.
If operating cash flow does not recover in line with revenue, future free cash flow generation could remain pressured.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased from the prior quarter and the same quarter a year ago, yet operating cash flow decreased significantly, resulting in lower free cash flow and a reduced free cash flow margin. Capital expenditure rose slightly, contributing to the weaker conversion.
Compared to the prior quarter, operating cash flow, free cash flow, and margin all declined, despite a modest revenue increase. Versus the same quarter a year ago, revenue was higher but operating cash flow, free cash flow, and margin were lower, with a larger relative drop in cash generation.
Monitor the trend of operating cash flow relative to revenue, as the current quarter's conversion rate weakened markedly.